But experts think the Bank is probably waiting for more concrete evidence of a turnaround before stepping in.

Gains in services

The BCC questioned 7,439 firms employing nearly three quarters of million people.

Among manufacturing firms surveyed, its measurement for domestic sales and orders came in at 0% compared to +9% in the previous quarter. "Home sales balances were at their lowest level since Q4 2001," it said.

Manufacturing exports also weakened to -2%, though employment in the sector edged up slightly, from -6% to -5%.

Service sector firms reported both domestic sales and orders had strengthened.

Sales improved from +13% to +26%, and orders from +9% to +18%.

Service sector employment rose but while export indicators improved, they remained "relatively weak".

The BCC urged the UK Government to put strengthening industry's competitiveness at the forefront of its economic agenda, particularly in the pre-budget report which Chancellor Gordon Brown is due to present in November.